Minister of Financial Services Ryan Pinder applauded the Bahamas Financial Services Board (BFSB) and all participating firms for continuing to work with the current administration.

He said that the BFSB was “a voice to the government on expressing both concerns and new opportunities in the industry that cause for the development of new products and joint promotional activities.”

Minister Pinder made the comments at the BFSB Annual General Meeting, held at the British Colonial Hilton, September 25, 2013.

“I want to encourage all member firms to be active in BFSB efforts to advocate and encourage the advancement of the financial services industry.”

“I also urge you to encourage other financial services firms and new entrants to the industry to embrace the membership benefits of the Bahamas Financial Services’ Board, to expand the network and expertise available to BFSB’s efforts.”

Minister Pinder said that the BFSB has distinguished itself locally and internationally as an advocate for The Bahamas’ financial services industry, broad-based membership and continual opportunities to grow the industry.

“Through the BFSB, you have been active in formulating guidance for issues such as FATCA implementation and choice of Inter Governmental Agreement, development of new products, such as SMART Fund 007, and the development of new niche industries such as captive insurance which I am confident is on the verge of significant expansion,” he added.

In giving a brief update on the status of the Foreign Account Tax Compliance Act (FATCA) implementation, Minister Pinder told BFSB members that, as they already knew, The Bahamas government has chosen a Model 1 Intergovernmental Agreement (IGA) as the framework on how FATCA will be administered in The Bahamas.

He said the government has reviewed the IGA and has some suggested drafting changes.

“We have been coordinating with countries in the region with the goal to obtain agreement on suggested revisions and to approach the United States on a multilateral basis with respect to our suggestions,” Minister Pinder said.

He noted that the government is issuing a request for bids by consultants on advising the government on what is entailed to fully implement FATCA. This would include, he continued, recommendations as to the structure of the competent authority, staffing, technological needs and administrative functions.

“The timelines will be tight and we hope to be in a position early next year to know exactly what needs to be implemented and the cost of doing so,” Minister Pinder said.

“We have also been in consultations with the Office of the Attorney General on the preparation of the legislation that will cause for FATCA to be implemented. This is an ongoing process.”

While briefly mentioning value added tax (VAT), and the process and the application in the financial services industry, Minister Pinder said that, at the policy level, his Ministry has been in discussions with the Ministry of Finance on the application of VAT to the industry.

He said that the financial services industry could be either treated as zero rated or exempt, depending on if it is defined as a financial services firm by legislation or regulation, or if it is an export services firm.

“We at the policy level are discussing the best way to advance this issue,” Minister Pinder pointed out.

“Once Cabinet has approved the draft legislation and regulations, through the BFSB we will hold consultations with the industry explaining the agreed framework and get your input on how it will effect your business and any recommendations.”

“We hope to do this in the coming month,” he added.

“You will have full opportunity to review the draft rules and provide your input and recommendations to government.”

Minister Pinder commended the chief executive officer of BFSB, Aliya Allen, on her advocacy and dedication to the financial services industry of The Bahamas.

“Ms Allen has worked hand in hand with the government on various initiatives ensuring BFSB’s concerns and ideas are always represented,” Minister Pinder said.

“Her focus and dedication is to be applauded.”

To the board of directors, Minister Pinder said that he must commend them on their high level of commitment and involvement in providing guidance and oversight to the Bahamas Financial Services Board and being a “key body in promoting the importance of a relationship between the government and private sector.”

“With the Bahamas Financial Services Board comprising of lawyers, bankers, fund administrators, trust officers and other specialists, I applaud you on your comprehensive approach in governing BFSB,” Minister Pinder said.

Audience members listen to Minister of Financial Services Ryan Pinder speak at the Bahamas Financial Services Board Annual General Meeting, September 25, at the British Colonial Hilton. (BIS Photo/Eric Rose)